The prices of liquid fuels in Mozambique, namely gasoline and diesel, can be lowered from the current 87 meticais to 72 meticais. For this purpose, the Center for Public Integrity (CIP) proposes the transitional elimination of Customs Duties (DA, 5%) and Value Added Tax (VAT, 17%) on the import of these goods.

According to the CIP, this is a suggestion that intends to replace the 20 measures announced on August 09 by the President of the Republic to mitigate the impact of the cost of living in the country.

From the point of view of that Non-Governmental Organization, the ideal is to eliminate DA and/or VAT in the calculations of fuel imports, because the common denominator on the cost of living in the country is the rise, in the international market, of fuel prices, which has a negative knock-on effect on other sectors.

"In place of the announced measures, it is suggested the elimination of customs duties and VAT, in a degressive manner, for a period of 90 days, in order to set the price of diesel at 72.93 Mts/liter and gasoline to 72.74 Mts/liter," reads the document consulted by MZNews.

The impact of adopting this proposal would be $71 million that the Government can mobilize, as it equals $53% of the $135 million currently available to subsidize transporters and users. Thus, this measure "can [take effect] from the next fuel importation and be subsidized with the resources mobilized by the Government."

For the CIP this could "effectively safeguard the purchasing power of the population since fuel prices have an effect on the general price level as a whole.

These and other measures are being accepted in other countries to contain the rise in food prices and non-renewable energy derivatives, says the CIP, noting that in Mozambique these measures are associated with other proposals.